Coastal Access Toolkit

Using Tax Policy for Access

Taxation can be used to encourage public access in two major ways. Taxes on the sale of land can be used to raise money to buy additional access rights. Small fees for parking at public beaches or boat ramps can also raise revenue, though often these funds are dedicated to upkeep of the public area. A second option is to use tax incentives to encourage socially or economically important uses, or to discourage uses that will inhibit coastal access.

How can taxes be used to generate funding for access?

Taxes can be used as a means of raising funds that the public can invest in the acquisition of public access through voluntary purchases or through eminent domain. A land gains tax or tax increment financing are examples of such taxation strategies. Under these approaches, a local government can use taxes generated within a development district to fund infrastructure improvements. For example, revenues generated from tax increment financing could be used to enhance or create public access infrastructure within that development district.

How can tax incentives be used for access?

Reductions in a landowner’s taxes can be used as an incentive for allowing public access or to discourage uses that inhibit such access. Tax incentives may include income tax deductions, lowered property taxes, lowered estate taxes, avoidance of capital gains taxes, and gained investment interest. For example, a landowner may receive a tax benefit for granting a conservation easement on their property. This can be a powerful incentive for a landowner. Working with the easement holder, the parties can design a conservation easement that provides tax benefits to the landowner while at the same time provides coastal access to a group of users.